Vodafone's Strategic Growth Management Plan: A Comprehensive Analysis

BUSINESS STRATEGY

INTRODUCTION
A strategic manager is responsible for making plans and targets for the company in coming future;
she/he is also responsible to consider various internal and external factors while making plans for the
company (Sminia, 2017). This report is on the role of strategic manger and various topics of strategic
management. This report is on Vodafone a private limited telecom company based in the UK. In this
report, strategic growth management plan drafted considering micro and macro environmental analysis.
Use of various tools such SWOT analysis, PESTLE has been used to device appropriate conclusions.
Finally, a strategic plan for Vodafone made for its growth and development.
Vodafone is a British multinational telecom company, whose headquarters are in London. It started in
1982 and grown rapidly since then ( Theoriginof, 2012). Now Vodafone has the presence over seventy
countries with over forty-seven million pounds of revenue. Its objective is to deliver easeful
communication faculties to its user with the most advanced feature enabled in it. It also aims to provide
good customer care to customers at affordable rates. It also aims to reduce its carbon footprint by using
environmentally friendly resources. Vodafone is unique about its marketing skills and advance
innovation in the telecommunication sector.
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P1 IMPACT AND INFLUENCE OF MACRO ENVIRONMENT ON VODAFONE
Macro environment condition is the situation faced by the country as a whole; various points that
considered in the macro environment are financial policy, GDP, employment rates. These are factors
affect the growth and development of the company and planning the strategies according to them will
help the company to deliver better results (Siepmann et al., 2011). The tools used to analyse macro
environmental conditions are SWOT analysis and PESTLE analysis. These tools will help to find the macro
environmental factors for Vodafone in detail and derive results out of them.
PESTLE ANALYSIS
The pestle is an acronym for political, economic, social, technological, legal, and environmental analysis
of a subject. The Pestle analysis of Vodafone will help us to determine the strategic decision that the
company is required to get the desired results.
Political Factors
The various political factors that affect the strategic decision for Vodafone’s are:
 Roaming regulation in Europe can have a negative impact on the company as any changes in
rules and regulation can force the company to increase the tariff rates (Knieps and Zenhäusern,
2010).
 Regulator laws imposed by the state can control the telecommunication sector by reducing the
impact of competition.
 Brexit has affected Vodafone by dividing the number of the customer from Europe and Britain.
 Governments have been trying to reduce the cost of communication, for this, the authority can
pressure Vodafone to reduce the tariff.
The risk associated with the political factors must consider before making the strategic plan. The
strategic plan must be able to balance the need for Vodafone and the government.
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Economic Factors
The economic factors that are important for strategic management are:
 The fall in GDP due to global economic crises in major markets of Vodafone have limited the
growth of the company (Weeks, 2011). The GDP is only about 2% of Europe and 5% to 7% in
other developing countries.
 The other major economic challenge that the company has to face is currency exchange rate
that it has to pay to make the profit in the home currency. As it operates in more than sixty
countries, Vodafone has to pay a lot of currency exchange rate.
Social Factors
Social factors play a very important role for the telecommunication companies like Vodafone. The social
factors that are significant are as follows:
 Population growth in the markets of Vodafone is slow and declining, due to which the potential
of market growth is limited.
 The amount of disposable income that is the amount an individual spends on the
telecommunication service is decreasing whereas it is increasing for the data services. Vodafone
offers both types of products hence a balance is likely to happen.
 The European population is becoming more and older in age, due to which the revenue growth
is likely to decrease.
Technological factors
The technological factors that affect the strategic decision-making are:
 Vodafone faces cyber-attacks and other threats related to hacking and privacy issue for itself
and its customers.
 Up gradation of technology and bring in new technology is also a challenge for Vodafone.
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Legal factors
The legal that for Vodafone for its strategic decision are:
 Allocation of legal bandwidth and the privacy laws in telecommunication are strict and their
misconduct may damage the company image.
 Taxation, employment and safety laws are rigorous the telecommunication industry.
Environmental Factors
The environmental factors that considered for Vodafone are:
 Reduction in the greenhouse emission due to company activities is a major consent.
 Use of renewable energy and the laws related to them have are different for different countries.
 Customer desire to use products that are less in carbon emission of it is the responsibility of the
company to make green products and services.
SWOT ANALYSIS
SWOT analysis is analysis determine strength, weakness, opportunity, and threats (Harding,2017) of the
Vodafone in macro environment condition:
STRENGHT
 Excellent marketing skills
 Massive market coverage
 Large customer base spread over forty
countries
 A high amount of revenue generation
 Good brand image
(rankingthebrands,2018)
WEAKNESS
 Low performance in Europe
 Market Share of Vodafone is reducing in
USA market.
 Reducing brand valuation (statista,2018)
 Reducing customer base
OPPORTUNITY
 New Rural markets
 New technology like optical fibre and 5G
THREATS
 Saturation in existing markets
 Facility to change mobile service provider
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(Alavi et al. 2016)
 Improving network coverage
 Potential to expand in new emerging
countries
 Tremendous competition in the
telecommunication
 Legal challenges in the telecommunication
sector
M1 CRITICAL ANALYSIS OF MACRO ENVIRONMENTAL FACTORS
The macro environmental factors are responsible for the major strategic decisions that taken in
Vodafone. These analyses of macro environmental factors help the company to improve the quality of
decision, management risk, and increase the productivity. Some of the factors lay a negative impact on
the company and some of the factors are strength better performance.
The political factors lay a negative impact on the company, due to the difference in the objective
between the company and the governments, these factors are not likely. However, a balance between
the need of the company and the government is required. The economic factors are becoming
favourable for Vodafone as after the economic crises the markets have started to grow and better
currency management facility have helped the company to develop. Adaption of new and better
technological up gradation can help Vodafone to overcome technological challenges. Legal condition
improved by deploying better legal management teams that can help to make the legal condition
favourable towards the company. The social factors have a negative impact on Vodafone in the
European market and the company do not have the power to control them, but it can offer a creative
solution to make them favourable. Vodafone is taking good environmental initiatives this has helped the
company to overcome the environmental challenges; it has identified the customer need for
environmental formerly products and services and made relevant changes in its regard.
A balanced strategy made to overcome challenges provided by this factors and it utilizes positive affects
effectively. The strategy must be able to deliver profits and productivity to the company, and proper
growth.
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